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Prudential Asset Management is the investment manager and LaSalle Investment Management is the underlying portfolio manager. In February, LaSalle helped launch an open-ended Asia property fund as sub-advisor to Prudential Property Investment Management (PruPim), a unit of Prudential Assurance, and it has also run segregated accounts for the insurance company. The PruPim property fund concentrates on core and core-plus physical property investments, so whilst LaSalle is involved in both offerings, the former was a different kind of product from this new fund, which in many ways might be described as a fund of Reit funds.
Asset allocations will concentrate on global real-estate investment trusts, which will account for 85% of investments, with the remainder real estate-related securities. The fund will have a strategic focus on commercial real estate, in addition to giving investors insurance coverage.
Expected annual returns are 10-13% over next three years, with an expected dividend yield exceeding 3.2%. The fund is targeted to grow to $100 million by the end of 2007.
The fees for the fund are dependent on the insurance policy, in the form of investment-linked plans, which are bought by investors. These will depend on the level of insurance coverage for eventualities such as death or illness. Typically, fees will be 5% bid/offer spread and a 1.5% annual management charge.
Prudential Singapore has $6 billion under management and is one of the countryÆs biggest life insurance companies. The portfolio manager La Salle Investment Management is a global real-estate investment manager with $10 billion in assets under management.
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Actively managed funds were also not found to have better odds of higher returns than more passive funds.